Stock Price Trends
Stock price trends estimated using linear regression.
Summary
Key facts
- The primary trend is increasing.
- The growth rate of the primary trend is 47.35% per annum.
- WDAY price at the close of March 11, 2025 was $242.93 and was lower than the bottom border of the primary price channel by $110.56 (31.28%). This indicates a possible reversal in the primary trend direction.
- The secondary trend is increasing.
- The growth rate of the secondary trend is 6.28% per annum.
- WDAY price at the close of March 11, 2025 was inside the secondary price channel.
Linear Regression Model
Model equation:
Yi = α + β × Xi + εi
Top border of price channel:
Exp(Yi) = Exp(a + b × Xi + 2 × s)
Bottom border of price channel:
Exp(Yi) = Exp(a + b × Xi – 2 × s)
where:
i - observation number
Yi - natural logarithm of WDAY price
Xi - time index, 1 day interval
σ - standard deviation of εi
a - estimator of α
b - estimator of β
s - estimator of σ
Exp() - calculates the exponent of e
Primary Trend
Start date: May 17, 2022
End date: April 12, 2024
a = 4.0797
b = 0.0011
s = 0.0750
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0011) – 1
= 47.35%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0750) – 1
= 35.01%
May 17, 2022 calculations
Top border of price channel:
Exp(Y550)
= Exp(a + b × X550 + 2 × s)
= Exp(a + b × 796 + 2 × s)
= Exp(4.0797 + 0.0011 × 796 + 2 × 0.0750)
= Exp(5.0752)
= $160.00
Bottom border of price channel:
Exp(Y550)
= Exp(a + b × X550 – 2 × s)
= Exp(a + b × 796 – 2 × s)
= Exp(4.0797 + 0.0011 × 796 – 2 × 0.0750)
= Exp(4.7750)
= $118.51
April 12, 2024 calculations
Top border of price channel:
Exp(Y1,028)
= Exp(a + b × X1,028 + 2 × s)
= Exp(a + b × 1,492 + 2 × s)
= Exp(4.0797 + 0.0011 × 1,492 + 2 × 0.0750)
= Exp(5.8144)
= $335.09
Bottom border of price channel:
Exp(Y1,028)
= Exp(a + b × X1,028 – 2 × s)
= Exp(a + b × 1,492 – 2 × s)
= Exp(4.0797 + 0.0011 × 1,492 – 2 × 0.0750)
= Exp(5.5142)
= $248.19
Description
- The primary trend is increasing.
- The growth rate of the primary trend is 47.35% per annum.
- WDAY price at the close of March 11, 2025 was $242.93 and was lower than the bottom border of the primary price channel by $110.56 (31.28%). This indicates a possible reversal in the primary trend direction.
Secondary Trend
Start date: May 26, 2023
End date: March 11, 2025
a = 5.2546
b = 0.0002
s = 0.0944
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0002) – 1
= 6.28%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0944) – 1
= 45.86%
May 26, 2023 calculations
Top border of price channel:
Exp(Y808)
= Exp(a + b × X808 + 2 × s)
= Exp(a + b × 1,170 + 2 × s)
= Exp(5.2546 + 0.0002 × 1,170 + 2 × 0.0944)
= Exp(5.6387)
= $281.10
Bottom border of price channel:
Exp(Y808)
= Exp(a + b × X808 – 2 × s)
= Exp(a + b × 1,170 – 2 × s)
= Exp(5.2546 + 0.0002 × 1,170 – 2 × 0.0944)
= Exp(5.2612)
= $192.72
March 11, 2025 calculations
Top border of price channel:
Exp(Y1,255)
= Exp(a + b × X1,255 + 2 × s)
= Exp(a + b × 1,825 + 2 × s)
= Exp(5.2546 + 0.0002 × 1,825 + 2 × 0.0944)
= Exp(5.7481)
= $313.58
Bottom border of price channel:
Exp(Y1,255)
= Exp(a + b × X1,255 – 2 × s)
= Exp(a + b × 1,825 – 2 × s)
= Exp(5.2546 + 0.0002 × 1,825 – 2 × 0.0944)
= Exp(5.3706)
= $214.99
Description
- The secondary trend is increasing.
- The growth rate of the secondary trend is 6.28% per annum.
- WDAY price at the close of March 11, 2025 was inside the secondary price channel.
- Discover a new approach to trend analysis.
- Check the power of mathematical statistics.
- Price channels have never been so accurately estimated.
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